S&P500 trend line break (continued)

by Malcolm Pryor on 16/12/2012

The S&P500 index broke a major trend line to the downside in the week ending 14 November 2012. As you can see on the attached chart the trend line connected the October 2011 and June 2012 lows. Since then the chart shows the weekly closes hugging the extension of that trend line, neither moving up and over it nor falling back down from it. Until one of those 2 outcomes occurs in effect the market is in a state of balance. Those influenced by fundamentals might suggest that the market is waiting to see the result of negotiations on the USA's so called "fiscal cliff".